Is it time to fix your mortgage?

IveSeenTheLight

from http://www.moneysavingexpert.com/news/mortgages/2010/04/time-to-fix-your-mortgage?utm_source=forum&utm_medium=sidebar&utm_campaign=box

Mortgage rates are at their lowest level for a year so is now the time for homeowners to lock themselves into a cheap fixed rate deal?

Figures from data provider Moneyfacts show the average two-year fixed rate stands at 4.63% compared to 5.21% 12 months ago, which would represent a £600 drop in annual costs on a £150,000 loan.
Typical five-year fixes are at 5.85% compared to 6.24% this time last year, which equates to a £432 annual payment drop on the same mortgage.

This has led some to suggest now is a good time for those on their lenders' standard variable rate (SVR), or first-time buyers, to get a deal which guarantees relatively low payments for two, three, five or 10 years.

On the flip side, many economists predict Bank of England base rate will stay low for months which is likely to keep SVRs and other variable rates low. Other factors such as a possible hung parliament may affect rates.

With this in mind, we asked three leading mortgage experts what their outlook is for the market to help you decide whether to go for the surety of a fix or gamble on variable mortgage rates.

Further proof that mortgage rates are dropping.

doire_2

Pity FTB cant get one to begin with

maveli

A no brainer for people like me who are on lifetime tracker (BoE + 0.23)

phil_b_2

I got my 2-year fix at 3.98 nearly a year ago so would love to know what sort of 5-year fix deal I could get now.

mitchaa

maveli wrote: »

A no brainer for people like me who are on lifetime tracker (BoE + 0.23)

A bug*er if the tories get in though and they go upto 15% overnight;)

Happened before, sure as hell can happen again:D

maveli

mitchaa wrote: »

A bug*er if the tories get in though and they go upto 15% overnight;)

Happened before, sure as hell can happen again:D

Yes. It happened before. But if it happens again with more than 40% of UK mortgages in tracker will lead to HPC. Is this a fair statement

IveSeenTheLight

doire wrote: »

Pity FTB cant get one to begin with

Figures would suggest that there are thousands of FTBers that can.

Jonbvn

maveli wrote: »

Yes. It happened before. But if it happens again with more than 40% of UK mortgages in tracker will lead to HPC. Is this a fair statement

If rates went to 15% in a similar manner to 1992, then paying your mortgage is likely to be the least of your worries.

michaels

5 years first direct 4.54%

It is a real punt at the moment on whether this beats the best trackers at base+1.99%

All the options from inflation to stagflation to double dip deflation are within the probability fan imo...

undetterred

IveSeenTheLight wrote: »

Figures would suggest that there are thousands of FTBers that can.

Seems to be just the MSE FTB'rs that are struggling?

IveSeenTheLight

michaels wrote: »

5 years first direct 4.54%

It is a real punt at the moment on whether this beats the best trackers at base+1.99%

All the options from inflation to stagflation to double dip deflation are within the probability fan imo...

Brittannia offer a 10 year 5.29% fix, which is worthwhile considering.
you can even get one with £0 arrangement fee for 5.49%

http://www.britannia.co.uk/_site/channels/mortgage/products/10yr-fixed.html

their 5 year fix is 4.49%
http://www.britannia.co.uk/_site/channels/mortgage/products/5yr-fixed.html

or you could get a 5 year capped rate at BoE + 2.49% capped not to go above 5.99%
http://www.britannia.co.uk/_site/channels/mortgage/products/5yr-capped-tracker.html

Certainly seems that mortgage companies are not factoring in rates going rapidly high in the coming years